Lao PDR, a lower-middle income economy with a GNI per capita of $1,730 in 2015, is one of the fastest growing economies in the East Asia and Pacific region. GDP growth averaged 7 percent over the last decade, with increasing use of the country’s natural resources – mostly water, minerals and forests – contributing one third to growth. Construction and services also expanded, with growing regional integration boosting tourism and attracting foreign investment.
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The World Bank
Lao PDR’s economic growth has moderated in recent years, but remains high, with income per capita reaching $2,330 in 2017. GDP growth averaged 7.8% over the last decade, with the use of the country’s natural resources – mostly hydropower potential, minerals and forests – contributing around one third of this growth. Economic growth remained vibrant in 2017, though slower compared to earlier years. An expansion in power generation, manufacturing, and agriculture was offset by a slight deceleration in investment, slower credit growth, and a drop in tourism. The growth in agriculture, where most Lao workers are engaged, and the recent expansion of labor intensive manufacturing, albeit from a low base, are expected to help in poverty reduction. Growth is expected to further ease slightly in 2018 as current trends continue, before picking up in 2019-2020 supported by increased power generation and growing opportunities in the non-resource sectors from closer regional integration and reforms to improve the business environment
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